Open Access
Can there be a market for cheap-talk information? : some experimental evidence
Loading...
Files
ECO_2016_07.pdf (757.51 KB)
Full-text in Open Access
License
Cadmus Permanent Link
Full-text via DOI
ISBN
ISSN
1725-6704
Issue Date
Type of Publication
LC Subject Heading
Other Topic(s)
EUI Research Cluster(s)
Initial version
Published version
Succeeding version
Preceding version
Published version part
Earlier different version
Initial format
Citation
EUI ECO; 2016/07
Cite
CABRALES, Antonio, FERI, Francesco, GOTTARDI, Piero, MELÉNDEZ-JIMÉNEZ, Miguel A., Can there be a market for cheap-talk information? : some experimental evidence, EUI ECO, 2016/07 - https://hdl.handle.net/1814/40625
Abstract
This paper reports on experiments testing the viability of markets for cheap talk information. We find that these markets are fragile. The reasons are surprising given the previous experimental results on cheap-talk games. Our subjects provide low-quality information even when doing so does not increase their monetary payoff. We show that this is not because subjects play a different (babbling) equilibrium. By analyzing subjects’ behavior in another game, we find that those adopting deceptive strategies tend to have envious or non-pro-social traits. The poor quality of the information transmitted leads to a collapse of information markets.